ISLAMABAD (The Thursday Times) — Pakistan’s two gas utilities have asked the Oil and Gas Regulatory Authority to raise their average prescribed gas prices for the current fiscal year, with the increases to apply retrospectively from July 1.
Sui Southern Gas Company has sought an increase of Rs366.75 per million British thermal units (MMBtu), which would take its average prescribed price to Rs2,071.75. Sui Northern Gas Pipelines has asked for a much smaller rise of Rs10.40, from Rs1,702 to Rs1,712.40 per MMBtu.
OGRA will hold hearings on both petitions before it makes a decision.
What it means for bills
The prescribed price is the average rate OGRA sets so that a utility can cover its estimated costs, known as its revenue requirement. It is not the tariff that households and businesses pay. Those are set by consumer category and change only when the federal government advises the regulator and notifies new rates.
In July, the government left consumer gas tariffs unchanged after OGRA’s earlier price determinations for the two companies.
LNG and the winter
In its petition, SNGPL included Rs60.147 billion in liquefied natural gas service costs, which it put at Rs471.16 per MMBtu. It said limited supplies of local gas in the winter would require extra arrangements and estimated that 16 LNG cargoes would be needed during the season.
Both companies cited higher international crude oil prices, which feed into the cost of imported gas.
The petitions come as falling output from Pakistan’s ageing gas fields deepens its reliance on imported LNG. They follow two cuts in petrol and diesel prices this week and a government move to let PSO and SSGC set LPG prices in place of OGRA.
